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The EU has dropped disciplinary action against the Czech Republic, Slovakia, Italy and Portugal over excessive budget deficits, judging they had sufficiently improved their finances, the bloc's Slovenian presidency said. The Czech Republic met EU criteria (3 percent of GDP) back in 2006 when its deficit fell to 2.7 percent of GDP. A year later, it dropped to 1.6 percent of GDP. The European Commission has recommended that the deficit should decrease to 1.4 percent this year and 1.1 percent in 2009.

The Czech government sent two versions of its EU presidency programme to Brussels on Monday. European Affairs Minister Alexandr Vondra said one of the versions envisaged the adoption of the Lisbon Treaty by all EU member states, whereas the other allows for the contrary. The Czech Republic will assume the EU presidency in January 2009 under the motto “Europe without Barriers”.

The Czech Republic will do its best to try to get Germany and Austria to open up their labour markets to Czech citizens, Czech Labour and Social Affairs Minister Petr Nečas said at a debate on cross-border work-mobility on Saturday. The minister said that the Czech Republic’s motto for its European presidency in the first half of 2009 was “Europe Without Barriers” and that the country intended to try and secure that for all member states. France, Belgium and Denmark have indicated that their will open their labour markets to Czech citizens before the end of the year, which would leave only Austria and Germany holding out. Germany has said it intends to protect its labour market until 2011. Mr. Nečas said it would create a strange situation for Germany to withhold this right to the citizens of a country presiding the EU.

The Czech Republic has become the 20th country of the European Union to recognize independent Kosovo. When the decision was announced last week, it was criticized by some Czech politicians who claimed the government of the former Serbian province has not yet fully shown its commitment to upholding democratic principles and protecting Kosovo’s religious and ethnic minorities. Radio Prague asked the head of the Czech Liaison Office in Pristina Janina Hřebíčková what the situation in Kosovo was like at the moment.

France will open its job market to eight central and east European EU members who joined the alliance in 2004, including the Czech Republic. French Foreign Minister Bernard Kouchner made the announcement in Prague on Tuesday, saying that the move should take place during France’s EU presidency in the second half of 2008. A work permit for citizens from these countries will still be required. Paris originally planned to open its job market to citizens from central and eastern Europe in May 2009.

The ministers for EU affairs of France, the Czech Republic and Sweden have outlined a road-map of EU policy priorities for the 18-month period during which they will consecutively hold the rotating EU presidency. The seventy-page-long document includes chapters on energy and climate-change, security, labour and social issues. News of the agreement was announced by the Czech Deputy Prime Minister for European Affairs Alexander Vondra in Prague, following a meeting with his Swedish and French counterparts. Details of the agreement will not be disclosed until it has been debated by a summit of EU foreign ministers in Brussels on June 16th.

The Czech Republic inches ever closer to January 1st, 2009, when – for the first time – it will take the helm of the European Union. The agenda for the EU presidency over the next eighteen months will be shared between France, the Czech Republic and Sweden, and the deputy minister for European affairs Alexandr Vondra is hosting his French and Swedish colleagues this week to put the finishing touches to a 70-page document setting out EU policy.

In Business News this week: the Czech and Slovak electricity markets hook up; more oilseed rape is being grown in the Czech Republic than ever before; fuel prices shoot up in the last week; Czech airlines transport over one million passengers in the first quarter, and one fifth of Czechs cannot afford a ‘square meal’ every other day says the EU.

Addressing a two-day meeting of the European Nuclear Energy Forum in Prague on Thursday, Czech Prime Minister Mirek Topolánek urged Europe to look to nuclear power as a realistic means of fighting climate change. Although the prime minister’s speech met with approval from many of the delegates present, it evoked an angry response from the Greens in the governing coalition who have been doing their utmost to put a brake on nuclear energy in the Czech Republic.

The president of the European Commission, Jose Barroso, has praised the Czech Republic’s preparations for its presidency of the European Union in the first half of next year. Speaking after talks in Prague with the Czech prime minister, Mirek Topolánek, Mr Barroso said Mr Topolánek had very clear ideas about the main priorities for the Czech presidency. The Commission president said the Czech Republic would be heading the EU in a key period when it was forming new rules on its operation under the Treaty of Lisbon. Mr Topolánek said he was confident all 27 members would have ratified the reform document by the end of this year, paving the way for its implementation during the Czech presidency.

The Portuguese Commission president and Mr Topolánek also discussed the upcoming Euro 2008 football tournament, where their two countries will meet in the group stage. Mr Barroso said the game would feature the two best teams in the world.